Things Are Moving in Milwaukee: Small Tricks that Make a Big Difference
July 18, 2018
Milwaukee isn’t always on the forefront of most investors’ minds, but that might change soon. It is, after all, a city with only a 2.7% unemployment rate, a number that’s still steadily decreasing.
That’s just one of the reasons ROI Turnkey is expanding to include Milwaukee. Keep reading to learn more about its host of other great features—and how you can use ROI Turnkey’s real estate strategies to become a successful investor in whichever city you choose.
Find Your Market’s Niche
Milwaukee has a large elderly population, so it has a high demand for assisted living homes. It’s more effective for the government to place, say, four residents in a four-bedroom ranch than make separate assisted living facilities. That’s where real estate strategy comes in.
Pat Jemmings, a turnkey provider in Milwaukee, used that information to his advantage. Assisted living companies often sign his five-year leases for over $150 more than the average tenant’s rent. And since they prefer to stay in one place rather than switching providers all the time, he experiences nearly no vacancies on those properties. What’s more, his maintenance costs are much lower because the elderly tenants treat the properties better than most families.
The assisted living tactic might not work for everyone in every market—though if it works for you, by all means, capitalize on that. Still, there’s a lesson to be learned here. Find a niche that works for your specific market. Look for unique solutions that solve several problems at once, and suddenly you’ll find yourself a more successful investor.
Neighborhood Quality Matters
Imagine you found a property for $110,000 that completely renovated, renting for $1,200 a month. That sounds like a great deal, right? It definitely beats the 1% rule. And yet it could actually be a pitfall in disguise.
If that home is in a D+ or C- neighborhood, you ought to be cautious. Sure, the home’s a great price, but it spells trouble in the future. Think of the lack of appreciation, vacancies, and tenants who damage the property. This kind of home would only be worth it if it was available for $89,000, not $110,000.
When examining neighborhoods, do a reality check on the market you’re in. The Milwaukee market, for example, looks far different from something in California or New England. In California, the homes are much newer, so a property from the 1930s would be a bust. In Massachusetts, that’s business as usual.
In Milwaukee, the city has a pretty strict code enforcement, which means many homes look like they’re in at least a C neighborhood. On one hand, that’s great. It shows that the city cares about improvement, and progress is always a good sign for investors. But you should still be wary. A Milwaukee C- neighborhood could easily masquerade as a B neighborhood if you aren’t careful when comparing markets.
Look for Curb Appeal
That shotgun-style factory house might have the exact same value as a beautiful English Tudor home, but you can bet one will be easier to sell than the other. Curb appeal affects your appreciation, exit strategy, and type of tenants, so don’t sweep it under the rug.
Let the City Help You
Most of the city government members care about helping the town thrive. They’re more than willing to give you the information you need to help them do that.
Meet with the City Development Council and Chamber of Commerce. By doing just a little bit of research and networking, you’ll find a wealth of information, such as the following:
Milwaukee is a great example of all these tips, but it’s not the only place they work. No matter where you decide to invest, use these small tactics to make a big difference in your investment success.
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